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State staging economic comeback, study finds

by Andrew Moreau | January 5, 2022 at 12:00 a.m.

Arkansas delivered a robust economic comeback in December as overall business conditions improved by 20%, bolstered by improvements in durable-goods manufacturing, employment and wage increases for workers, according to an economic analysis released Monday.

State improvements were aligned with progress in the region overall, as business leaders in nine Midwest and Plains states indicated that the region's economy continued to improve going into the new year.

The final 2021 economic report from Creighton University showed the business conditions index in Arkansas climbing to 66.1 in December from 54.6 in November. In the region, stretching from Arkansas to Minnesota, the index improved in December to 64.6 from 60.2 the previous month. Any score above 50 on the survey's indexes suggests growth.

The monthly survey indicates that "the region is adding manufacturing activity at a positive pace and that regional growth will remain solid," Ernie Goss, the Creighton economist who heads the survey, said in a statement.

As manufacturing activity picks up, businesses operating in the region noted "supply chain delays worsened in December," the report said. A great majority of supply managers predict the situation will "get worse for the first six months of 2022," with half expecting the omicron strain of COVID-19 to slow deliveries.

Nevertheless, businesses operating in the region are confident growth will continue. The survey's business confidence index, which looks ahead six months, rocketed from a weak 46.2 in November to 64 in December. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

Most states showed small improvements while Arkansas and North Dakota were both up 20%. The index declined in Missouri and Nebraska.

In Arkansas, all components of the business conditions index improved. New orders were at 66.8, production or sales was at 52.9, delivery lead time was 81.6, inventories were at 72.3 and employment was 57.

Durable-goods manufacturing is leading a comeback, the report said.

"Since the beginning of the pandemic, Arkansas durable goods manufacturing experienced much stronger growth than nondurable-goods producers in the state," Goss said in the report.

Arkansas also appears to be outpacing the overall region in employment. The survey noted that the regional employment index remained positive for December, but dipped to 59.3 from 61.1 in November.

Unemployment in Arkansas has improved steadily since the pandemic began and has consistently beat the overall national joblessness rate. Arkansas' unemployment rate tumbled to 3.4% in November compared with the U.S. rate of 4.2%.

Also in November -- the most recent employment data available -- the number of unemployed for the month, 46,351, was the lowest total in recorded history going back to 1976. And the November rate of 3.4% also ties a record low of the same monthly rate posted in April and May of 2019.

The state reported that 49,366 more Arkansas had jobs in November 2021 compared with November 2020. Unemployment figures for December 2021 will be released later this month.

Print Headline: State staging economic comeback, study finds

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